Tax Attorney Fees 101

Hourly rate Typical tax attorney fees are at $200 to $400 on an hourly basis. Often, you will pay a retainer, which is based on the man hours that they believe your case will take, before the engagement begins. If your case goes beyond the estimated hours, you will then be billed for the additional hours. For simple cases like an “offer in compromise,” you will find that the retainer will be enough to cover everything. However, if you have to go to trial on a tax dispute, expect your hourly fees to reach anywhere from $5,000-$20,000.

Flat rate If getting your first billing for the hourly tax lawyer fees made you fall off your chair, think about discussing a flat rate payment scheme with your attorney. Here, you just pay a one-time fee and you do not have to worry about anything else. Be prepared for negative repercussions though, because while you have succeeded in paying a flat amount, your attorney is now left with no performance incentive to keep working on your case more than his other clients. If there is an unforeseen complication with your case, you may want to make a performance incentive for your lawyer so that you can ensure that they will work as hard as they can for you.

Contingency fee If you cannot afford a tax attorney fees upfront but have a valid case, then you can also talk to your lawyer about a results-based fee. Law firms will only consider this if they are confident that they can win the case. The simple truth is that while there is less money upfront, they stand to earn more if they win the case. If they are trying to talk you into a high percentage of the tax recovery, then try to talk them into including a low hourly rate combined with a low tax recovery percentage. You should know, however, that you will still have to pay for filing fees, phone charges, and photocopying expenses.

There are many ways that you can negotiate with the lawyer when it comes to his or her tax evasion attorney. Should you be one of those in a situation where no attorney will even try for a results-based fee, then think about possibly hiring a public defendant. Whether you choose to pay for the tax attorney fees hourly, results-based, or as an overall flat fee, you will certainly need an attorney by your side especially when you are dealing with the IRS. Russell Buffenbarger